What's the difference between ISIS and the Chinese communists circa 1946 or so? Both control a large swath of land and have a very militant driving world-view. Both are very willing to kill off people who don't fit their paradigm.
Mao and company would have been called rebels, revolutionaries or insurgents 70 years ago, since we didn't really have "terrorism" in our geopolitical vocabulary at the time.
Thus, are we at the point where we need a new adjective for ISIS? They seem to look more like a proto-government than a group of cells plotting bombings and gun rampages.
The Obama team doesn't mind the term terrorist to describe them, even while they bend over backwards to utter the tern "Islamic" in reference to them. Yes, they do employ terror tactics from time to time, as the Libyan beheadings clearly shows, but the police-drones-and-special-ops lawfare that the administration wants to do doesn't seem to be well suited for the task.
What to do about the situation is an open question. We don't seem to have the stomach or the leadership to do "boots on the ground" military actions to roll back ISIS.
In some places, we have friendly neighboring governments that can help provide troops and staging areas. In Libya, Egypt is in the process of stepping in to stop the ISIS-affiliated group there, and Jordan might be willing to swing north to help shore up their northern border. Turkey could be some help, but they seem not to have a dog in the Syrian fight, preferring that the Kurds get whittled down by both ISIS and the central government, keeping their aid more humanitarian.
It's not a pretty picture and isn't likely to get better any time soon.